Many insurance companies have customers with bases of operation in more than one U.S. state, and in many cases in more than one national country. Because of the legal, regulatory and tax differences between different states, nations and jurisdictions, most insurance companies underwrite policies from a particular location, to a Policyholder (i.e., First Named Insured) in that same location. For example, an insurance company based in Pennsylvania would only underwrite insurance to Pennsylvania residents or entities. However, in some cases, insurance companies in one state, nation or jurisdiction underwrite insurance providing coverage to risk exposures pertaining to that same Policyholder (or different Policyholder) located in another state, nation or jurisdiction. Examples may be states, nations or jurisdictions, where there are registered subsidiaries of the Policyholder, or where the Policyholder has property, representative offices, registered directors and officers, etc. In such cases, the insurance companies must ensure to act in accordance with the legal, regulatory and tax requirements for such other state, nation or jurisdiction. Such business practice is also known as Cross Border (CB) or Out Of Territory (OOT) coverage. When policies number in the thousands, and states, nations and jurisdictions in the hundreds, keeping track of all the different legal, regulatory and tax requirements can be cumbersome.
Additionally, some states, nations and jurisdictions place significant restrictions on ‘non-admitted’ or Out Of Territory (OOT) insurance companies, and in some cases do not permit such companies to insure risks or exposures located in their territories. For example under certain conditions and at the time being, Brazil, China, Japan, the Russian Federation, Switzerland, India, Malaysia, Mexico, Turkey, Thailand and Hong Kong all place significant restrictions on OOT insurance companies, irrespective of the place, where the insurance contract is negotiated. For example, if an US-based insurer is providing insurance coverage to a customer's premises or other exposure which is physically located in Switzerland, then, the US-based insurer is not permitted to do so without obtaining the proper authorization (license) from the Swiss insurance regulator (i.e., the Swiss Federal Office of Private Insurance (FOPI)), irrespective of the fact that this insurance coverage probably is negotiated and underwritten outside of Switzerland, in the US.
Accordingly, there is presently a need for a method for underwriting insurance which allows insurance contracts to be efficiently underwritten across different states, nations and jurisdictions, and which ensures that insurers act in accordance with legal, regulatory and tax requirements across different states, nations or jurisdictions.